ACCA Applied Knowledge · Business and Technology · Financial systems and technology
Which of the following best describes a benefit of a company outsourcing its payroll processing to a specialist provider?
Outsourcing payroll gives access to specialist expertise and possible cost savings, but the company has less direct control over the process. It also keeps its legal responsibility for accuracy, and confidential data is exposed to extra risk. Savings are not guaranteed in every situation.
- AAccess to specialist expertise and possible cost savings, but less direct control over the processCorrect
- BComplete elimination of the company's legal responsibility for payroll accuracy
- CStronger control over confidential data because it is held externally
- DGuaranteed lower cost in every circumstance
Explanation
Outsourcing offers specialist skills and potential cost savings and lets management focus on core activities, but control and confidentiality risks increase. The company remains legally responsible for payroll, and savings are not guaranteed.
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